Welcome to Regency Centers Corporation Q3 2024 Earnings Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star and zero on a telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the call over to Christy McElroy. Thank you, and over to you. Good morning, and welcome to Regency Centers Q3 2024 Earnings Conference Call. Joining me today are Lisa Palmer, President and Chief Executive Officer, Mike Mas, Chief Financial Officer, Alan Roth, East Region President and Chief Operating Officer, and Nick Wibbenmeyer, West Region President and Chief Investment Officer. As a reminder, today's discussion may contain forward-looking statements about the company's views of future business and financial performance, including forward earnings guidance and future market conditions. These are based on management's current beliefs and expectations and are subject to various risks and uncertainties. It's possible that actual results may differ materially from those suggested by these forward-looking statements we may make. Factors and risks that could cause actual results to differ materially from these statements may be included in our presentation today and are described in more detail in our filings with the SEC, specifically in our most recent Form 10-K and 10-Q filings. In our discussion today, we will also reference certain non-GAAP financial measures. The comparable GAAP financial measures are included in this quarter's earnings materials, which are posted on our Investor Relations website. Please note that we have also posted a presentation on our website with additional information, including disclosures related to forward earnings guidance. Our caution on forward-looking statements also applies to these presentation materials. Finally, as a reminder, given the number of participants we have on the call today, we kindly and respectfully ask that you limit your questions to one and then rejoin the queue if you have any additional follow-up questions. This will allow everyone who'd like to ask a question an opportunity to do so. Lisa? Thank you, Christy. Good morning, everyone. We are proud to report another really great quarter of results driven by the hard work of our team and continued robust operating fundamentals, including sustained strength in tenant demand. This is evident in our strong rent growth, our sizable leasing pipeline, our same-property leased occupancy rate, which we've now pushed above 96%, another record high for shop occupancy, and accelerating same-property NOI growth. As a result, we're raising current-year guidance and now expect same-property NOI growth of 3.5% and core operating earnings per share growth of nearly 5%. We've also continued to be very active on the investment side, especially through our development platform. Nick will go into more detail, but we've had another strong year of development and redevelopment starts, and we've already achieved our annual target of $200-$250 million of project starts for the second consecutive year. This success in sourcing new opportunities is a product of the team's expertise, relationships, and the strong tenant demand we are experiencing across our portfolio, and it is supported by our cost of capital and strength of our balance sheet. As our grocery partners and other tenants look to further expand their footprints, high-quality space in top trade areas is hard to come by, creating an opportunity for us to leverage our platform, and as we further grow our ground-up development pipeline, it will increasingly be a significant and unequaled differentiator for Regency across the peer group, amplifying total NOI growth beyond the impacts of our same-property portfolio. In addition to our development pipeline, in 2024, we've deployed nearly $300 million of capital into accretive transactions, including shopping center acquisitions and the repurchase of our own shares. Overall, we had an exceptional quarter, driving both strong organic growth within our current portfolio and creating meaningful value through our investments for the future. Yes, the operating fundamentals are robust in our sector today, but more importantly, our results reflect the talent of our team and quality of our portfolio, positioning Regency to thrive in the current environment as well as through economic cycles. Our assets are intentionally located in strong suburban trade areas benefiting from limited new supply. Our grocery-anchored neighborhood and community centers represent what we believe is the optimal retail format to serve consumers looking for necessity, service, convenience, and value, and we believe the high quality of our centers, with careful attention to merchandising mix, placemaking, and connecting with our communities, provides our centers with superior competitive positioning in the marketplace. In summary, I am so grateful for and proud of the efforts of our team in driving our strong performance and delivering exceptional results quarter- after- quarter. I really look forward to what we can achieve heading into 2025. Alan? Thank you, Lisa, and good morning, everyone. We had a tremendous quarter of operating and leasing results, evidenced in our strong base rent and same-property NOI growth. This was largely driven by robust leasing activity, accelerated rent commencement timing, higher shop tenant retention, lower credit loss, and favorable impact to expense recoveries due to higher occupancy. With regard to our occupancy, we ended the quarter above 96% leased for the first time since 2018 within our same-property portfolio, up another 20 basis points. We achieved yet another new milestone in our shop occupancy rate, ending the quarter at a record high of 93.7%. Our ability to move the occupancy needle higher is reflective of continued robust demand from both anchor and shop tenants in a wide range of categories, including grocers, restaurants, health and wellness, off-price, and personal services. Our same-property commenced rate was up 40 basis points this quarter, as we saw great progress accelerating rent commencement dates for the signed leases in our S&O pipeline, with earlier movements a credit to the hard work and collaboration between the tenants and our local teams. But even as we've gotten many tenants open and rent commencing, we've further replenished our S&O pipeline through our continued leasing success. It remains substantial today at 340 basis points and nearly $50 million of incremental base rent, representing a significant runway to commence occupancy and a tailwind to NOI growth looking ahead. We achieved strong blended cash rent spreads of more than 9% in the Q3 and GAAP rent spreads exceeding 20%, further demonstrating our ability not only to drive high rent increases when we are marking our leases to market, but also to embed meaningful contractual rent steps. Our retention rate remains above our historical average at over 85% in the quarter, while we also generated above-average renewal rent spreads of 9%. These positive renewal trends are reflective of the quality of our centers and the strong performance that our tenants are experiencing. Due to the great success we've had increasing occupancy, achieving strong rent spreads, embedding annual rent steps, and retaining tenants, our same-property NOI growth, excluding term fees and COVID period reserve collections, was ahead of our expectations for the quarter at 4.9%, with the majority of that growth coming from base rent contribution of 2.7%. We also had positive contribution from lower bad debt, which is indicative of the strong health and credit position of our tenant base. On the expense side, our team has had success in managing our operating expenses, and we've also seen an improvement in our expense recovery rate due primarily to higher shop occupancy and reflective of our ability to maximize the value of our lease contracts. In closing, I am proud of the great work from our team in delivering exceptional results, and we are energized for the opportunities to further drive NOI growth in 2025. Nick? Thank you, Alan. Good morning, everyone. We had another very active quarter of accretive investment activity, further building our value creation pipeline, including the start of two ground-up development projects, great execution on our in-process projects, and additional acquisitions of high-quality grocery-anchored shopping centers. Year to date, we've started more than $220 million of new development and redevelopment projects at blended yields exceeding 10%. For the second consecutive year, we anticipate starting more than $250 million of projects, with roughly half of those costs associated with ground-up developments in 2024. In the Q3 alone, we started nine projects totaling over $100 million, including two new ground-up developments. One of those we discussed on last quarter's call, a 160,000 sq ft H-E-B-anchored development in Houston called Jordan Ranch, which will serve as the retail component of a new thriving master plan community. The second is an 80,000 sq ft Safeway-anchored ground-up project in the Bay Area called Oakley Shops that we started in August. This project will serve as the primary retail destination in this attractive suburban trade area. We've also continued to make great progress executing on our in-process pipeline, which now totals over $600 million. Leasing activity on both development and redevelopment projects remains robust, with the projects currently more than 90% leased on average, with blended returns exceeding 9%. This quarter, we completed the Glenwood Green ground-up development in Old Bridge, New Jersey. We've seen strong community reception to this targeted ShopRite-anchored project, now over 95% leased, with tenants performing extremely well. In fact, we've meaningfully outperformed our underwriting expectations due to the strong leasing demand, enhancing the IRR and resulting in a 50 basis points increase to our estimated stabilized yield. As Lisa discussed earlier, our ground-up development program is a key differentiator for Regency across the peer group. We fully expect it to be an increasingly additive component to total NOI growth in coming years as we bring many of these projects online. The strong momentum and success of our sector-leading development program continues to be supported by the macro tailwinds within the shopping center industry, as well as the hard work of Regency's experienced development team, which I believe to be the best in the business. Our talent and relationships, combined with our flexible balance sheet and free cash flow, provide us with an unequal advantage in the shopping center development business today, particularly with ground-up opportunities. In addition to our $220 million of project starts and $200 million of share repurchases this year, we've also successfully completed the acquisition of more than $90 million of shopping centers, bringing our year-to-date investment activity to more than $500 million. In August, we acquired a neighborhood center in a strong suburban trade area in East Greenwich, Rhode Island, anchored by a market-leading grocery. Subsequent to quarter-end, we acquired an H-E-B-anchored center located in a prime retail node in the Austin suburb of Round Rock. Our team continues to be actively engaged, sourcing and underwriting additional deals that fit our investment criteria. In closing, our entire investment team is engaged and excited about our opportunity set. We look forward to not only seeing the growing benefits of our larger value creation pipeline, but also continued success sourcing new projects and accretive acquisitions. Mike? Thank you, Nick, and good morning, everyone. We reported strong Q3 results, outpacing our expectations primarily driven by fundamental operating performance. Results include Nareit FFO of $1.07 per share and core operating earnings of $1.03 per share for the quarter. Same-property NOI growth was 4.9%, excluding term fees and COVID period reserve collections, with the majority of that growth coming from base rents. As a result of this outperformance and continued higher expectations for the rest of the year, we're raising our current-year guidance ranges. I'll refer you to the detail on slides five and six in our earnings presentation while highlighting some key changes. The primary driver to our elevated earnings outlook is an increase in our same-property NOI growth by 100 basis points from the prior midpoint, now to 3.5%, excluding term fees and COVID period reserve collections. We now expect to maintain a higher average commenced occupancy rate this year due to a combination of accelerated rent commencement as we deliver our S&O pipeline and higher shop retention rates, reducing downtime impacts. Credit loss is also coming in lower than we had originally planned, given favorable uncollectible lease income rates or lower bad debt and positive bankruptcy outcomes. Notably, we now expect a credit loss range of 50-75 basis points this year, down from our previous range of 75-100 basis points. Lastly, following these higher levels of commenced occupancy, same-property NOI is also benefiting from higher net expense recoveries. We increased both our Nareit FFO and core operating earnings ranges by $0.05 per share at the midpoint, primarily driven by the increase to our same-property NOI growth outlook I just described. The new midpoint of our core operating earnings range represents nearly 5% year-over-year growth. Looking ahead to next year, while we have not yet provided our full suite of earnings guidance, as we will do that in February with our Q4 results, today, we want to provide some initial color to help with future expectations. For 2025, we expect same-property NOI growth to be very similar to our recently increased expectation for this year in the 3.5% area. And for Nareit FFO, we expect 2025 growth of at least 5%. As for a couple of reminders, in 2025, we will absorb the full year impact from this year's debt refinancing activity, and we also know that this year's merger-related expenses of approximately $7 million will not repeat. Moving to our balance sheet, we completed a $325 million bond issuance in August at a 5.1% coupon, which was used to pay down the balance of our line of credit. Following this transaction, we remain within our target leverage range of 5-5.5 times Debt-to-EBITDA, and we expect to generate Free Cash Flow of more than $160 million this year, fueling the growth of our development pipeline. We continue to be very proud of our balance sheet and liquidity position, providing Regency with a cost of capital advantage and the ability to create value when accretive opportunities arise. With that, we look forward to your questions. Thank you. Ladies and gentlemen, we will now be conducting a question-and-answer session. If you'd like to ask a question, please press star and one on the telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star and two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. We request you to limit yourself to one question. Ladies and gentlemen, we will wait for a moment while we poll for questions. The first question is from Jeffrey Spector with Bank of America. Please go ahead. Hi, this is Andrew Reale for Jeff. Thanks for taking our question. Just on the balance sheet, you received the credit rating upgrade for Moody's this year, no significant refinance needs until late 2025, and given you're now at the low end of your target leverage range, just wondering what your appetite is for levering up to fund growth, and has the reversal in interest rates changed your financing plans at all? I'll take that, Andrew. I appreciate the question. I would characterize our position within our ranges at the midpoint. I think we're very comfortable kind of floating between that five and five and a half times debt-to-EBITDA range. As we've demonstrated this year, we will lean into balance sheet capacity when we have it and when we see compelling opportunities. This year, in fact, we did that through the repurchase of our own stock. And I think it's important to remind everyone and consider that as we look at external growth comparisons across the peer group. For us, that was an allocation of our capital on an accretive basis, providing about a penny of earnings accretion this year and another penny looking out into the future. To the extent we see compelling opportunities going forward, we'll continue to use our free cash flow and our leverage free cash flow and our balance sheet capacity. And if we see something that's accretive to our internal rate of growth and consistent with our quality, we might even take that up to the upper end of our range. But we are committed to operating within that 5-5.5 times area, and we'll continue to do so going forward. Thanks, Andrew. Thank you. The next question is from Michael Goldsmith with UBS. Please go ahead. Good morning. Thanks a lot for taking my question. You took the Same-Property NOI growth expectation for 2024 to 3.5%. You're pointing to a similar number for 2025, and this represents an acceleration from what you experienced in the H1 of this year. So I guess, what has changed? Is it the strength of the leasing environment and the market that's kind of caught up, and now you're starting to reap the benefit of that and accelerating the Same-Property NOI, or are there some other factors that come into play? I guess just trying to understand what has changed that makes you feel more comfortable about this higher level of growth and that it's sustainable. I can start if the team would like, and I'll let Alan opine on the changes, but just from a numbers and cents perspective, Michael, nothing has really changed from our perspective. We've been pretty loud and confident over the past couple of quarters about our projections for future potential NOI growth and earnings growth following on. We knew coming into the year that we would have a bit of a trough in our average commenced occupancy, but we were also emboldened by the SNO pipeline that the team continued to build and replenish as we commenced rent. One thing that has changed this year, and especially validated through the Q3, is that we've accelerated rents coming out of that SNO pipeline into productivity. That has had a tag-along impact from a recovery percentage. It's really that timing of that kind of launch of our growth profile that we originally thought would be a Q4 event going into 2025. We started that process earlier through the Q3 results, really as a testament to the team's hard work, as a testament to the continued tailwinds we're seeing in the market. Yeah, I'm happy to jump in, Michael, too. I appreciate the question. As Mike said, we've been at it for a number of quarters now in terms of really focused on the rent commencement date acceleration, and creativity is paying off, and there's also great partnerships with our tenants. We are proactively white-boxing spaces where appropriate. We are getting tenants to start plans before leases are signed in many cases, something that was not a norm many, many months ago, ordering the right equipment in advance and negotiating favorable lease terms. Interestingly, the permitting and supply chain is really normalizing now, and it's allowing us to be more aggressive on defaults when tenants aren't prosecuting their plans and their permits. Collectively, we're starting to see it really pay off in terms of acceleration of rent commencement dates. Let's make it attractive. If you don't mind, Michael, I think we began talking about the growth that we expected and how good we felt about 2025 two quarters ago. And as Alan and Mike both said, we're starting to see the fruits of all the hard work and the quality of our portfolio and the quality of the team come through a little bit sooner. And the good thing is the 2025 growth is still there. And I know you're really familiar with our business model, as most people are on the call. We really do believe, again, with the quality of our portfolio, the quality of our team, and the redevelopment platform that we have will enable us on a stable occupancy basis to deliver Same-Property NOI growth, let's say close to 3% on a sustainable, steady basis. And while we're increasing occupancy, it's going to be higher. That's what we're seeing. The team continues to set the bar higher and higher for what we're able to achieve. We feel really good about our results, and I'm really proud of the team. Appreciate all the perspectives. Good luck in the Q4. Thanks, Michael. Thank you. The next question is from Craig Mailman with Citi. Please go ahead. Hey, good morning. Maybe on the capital deployment front, you guys are getting the money out there on the redevelopment side, and you put the $300 million out to acquisitions and share repurchases this year. But as you look at the acquisition market, do you feel like there's an opportunity for transactions one-off to accelerate above that $90 million as we head into 2025? And does it make sense from a funding perspective to kind of take the win on the share repurchase? And could that be a source of proceeds going forward to kind of reissue now that you're at or above kind of at least RNAV? Craig, this is Nick. Good morning. Appreciate the question. I'll take the first part and then have Mike maybe weigh in on the second part. But as you've indicated, we've really been active across all fronts. And so as we've said in the past, we will continue to prioritize our free cash flow and our capacity to our development and redevelopment program. And as I indicated in our prepared remarks, we have every indication we'll end this year again north of $250 million in that program, similar to last year. And then, as Mike alluded to earlier in the call, we have additional capacity to lean into when we find other opportunities that meet our criteria. And so as we look at one-off acquisitions, as we've talked about, if we find things that are consistent with our quality and our growth profile, we do have the capacity to lean in, especially when we identify ones that we can fund accretively. And so you can see throughout the year we've found those opportunities, and as we continue to identify those, whether it's in 2024 or 2025, the great news is we do have the ability and capacity to execute on this. Hey, Craig, let me follow up there. Thank you, Nick. From a capital sourcing perspective, we're going to be disciplined. We're very proud of our capital allocation track record. We have access to many forms of capital. We've been very cognizant around our understanding of our incremental cost of capital when we deploy it, and we'll use equity when and if that makes sense. But we have the balance sheet capacity. We have access to equity. Let me also throw in the acquisition we closed just after quarter end was with our partnership with Oregon. That's another new form of capital or a newly expanded form of capital that we have access to with a recent recommitment to that 25-year-old vehicle of another $150 million of equity from Oregon. So we have multiple sources of capital. We'll use it very on a disciplined basis with a mindset of growing earnings per share going forward. Thanks, Craig. Thank you. The next question comes from Greg McGinnis with Scotiabank. Please go ahead. Hey, good morning. Mike, it's obviously fairly substantial same-store NOI increase this late in the year. Would you be able to maybe rank out in terms of contributing to that increase the items listed? So the higher commenced occupancy and associated recoveries, retention rate, or on the bad debt side, and just trying to get an understanding as to which of those factors you think may be kind of long-term contributors in terms of how leasing and business is going or in terms of how you're handling tenants? Yeah. Hey, Greg, I appreciate it. You got the categories right. So higher retention rates, accelerated commencements out of that SNO pipeline, all leading to and translating to higher recoveries. I would say roughly 40% of the increase is from credit loss improvement, and that would be both a combination of ULI or that debt expense down from our expectations back in August on the margin. And I'd say our run rate year-to-date is 40 basis points. That's, as we've talked about in the past, that's below our historical averages. Our outcomes on bankruptcies is part of that 40% component. The balance is roughly split evenly between accelerated commencements, higher retention, and higher recoveries as a result. So that's how I would compartmentalize the change. From a news flow perspective, it sounds like we're hearing about more retailers under risk or more store closures, and especially more restaurant closures. As we're looking forward into 2025, for now at least, not looking for guidance, but is the expectation for kind of a normalization on the bad debt side, or is there anything in particular about the portfolio or what you're seeing from the consumer maybe making you a bit more bullish on that front? Yeah. We're going to be short of offering a full suite of guidance at this point in time, but I do think it's fair to indicate that we would plan for a roughly historical average level of bad debt and credit loss next year. So recall that bad debt expense and bankruptcy outputs, that's basically a 75-100 basis point credit loss provision. So I would plan for that level next year. From a color perspective, Alan, if there's anything you want to share. Yeah. I mean, Greg, I would just say that we're always intensely managing the portfolio. And one comment I made last quarter is I identified some of those bankruptcy filings that you had noted. Conn's, we had zero locations. Eastern Mountain Sports, Rue21, and Red Lobster, we had one with all three of them. And so was that an anomaly in Q2? I think as you look at the Q3 filings now, a similar thing has happened. Buca di Beppo has filed, Roti has filed, Big Lots has filed, and we have one location with all three of those as well. And so I think that's just a testament to really the team staying committed to quality merchandising and really our qualification process. And we feel good about the strength of the sales, as Lisa mentioned, the strength of the portfolio and the markets that we're operating in right now, but we're certainly always keeping a watchful eye on it. Just as a reminder, we are limiting to one question. We have a lot of people on the queue. Thanks, Greg. Sorry. Thank you. The next question is from Todd Thomas with KeyBanc Capital Markets. Please go ahead. Hi, thanks. Good morning. I just wanted to ask about UBS, and the guidance increase this quarter was mostly attributable to the same store, and that's where the majority of the discussion's been. But two questions around that. Can you just remind us when that portfolio will enter the same store pool and how we should think about maybe that impacting 2025 growth? And then can you provide an update on sort of the opportunities for upside that you see within that portfolio as it stands today? Yeah. Hey, Todd. Welcome to the party, by the way. I appreciate having you. I will take the first, and I'll let Alan maybe comment on activity within the portfolio. We will officially move those assets into same-property effective with Q1 of next year. So we'll come out of the gates next year with UBP assets as part of our same-store portfolio. My comments around growth next year would include those assets. So 3.5% in the area, 3.5% growth next year would include performance from UBP. Honestly, we don't see a material difference between the performance of those assets and Regency's at this point in time, and that was all consistent with the outlook we had going into the merger at the beginning. Hey, Todd. This is Alan. I would just say we are thrilled with the expanded platform, more thrilled with the integration of some really great people. But things are going well. We signed over 200 leases year-to-date in the portfolio, and we've got runway to continue to grow that percent lease. And that is the one thing we've been saying since the acquisition. It's really a hyper-focus on lease, lease, lease from a redevelopment perspective, as you asked. We do think there's going to be some opportunity there, but it's in sort of a smaller mindset here on the front end of some pad creations in the parking lots, a couple of renovations, and mid- to long-term we'll evaluate some bigger redevelopments. But I would use our Danbury Square as a good example. At the time of the merger, it was 50% leased, and through really great leasing by the team, we're at 96% now. And so that's sort of the mindset within the portfolio, and that's where we're focused. And because you are new to the party, it has performed, as Alan said, as we'd expected, if not slightly above our expectations, exactly what we thought. And at the time when we did announce the merger, we did comment that it was very consistent with our quality. There weren't a ton of redevelopment opportunities, and it was going to be a leasing exercise that we underwrote and anticipated spending a little bit more capital because of the amount of leasing that we were going to do, performing exactly as we expected. And so when we rolled in the same-property percent leased, it's still not as well leased as what you will call legacy Regency. So we still have some opportunity there, and that is really what you'll see when we roll it in the same property. Thanks, Todd. Thank you. The next question is from Juan Sanabria with BMO Capital Markets. Please go ahead. Hi, good morning. Just hoping you could talk a little bit about 2024 performance, which has obviously been better than you'd expected, and your early thoughts on 2025. Is the earlier-than-expected rent commencements, is that pulling forward growth that you otherwise would have thought would have come next year? And should we think of the 3.5% as kind of the floor on growth next year? I recognize this is a little bit of a sensitive question, just but any color you can give on how we should be thinking about the puts and takes should be helpful. Thank you. Yeah. I appreciate the question, Juan, and you'll appreciate the response. The 3.5% area is what we're indicating for next year. I think that's enough to share at this point in time. Listen, we're still working on the finer edges of our plan for next year, and we'll put out a full suite of guidance next quarter, and we'll give you, as we customarily do, a lot of transparency into the support for that. But no, to your first question, I don't feel like it's a pull forward. I feel like this is a launching point, and we've been talking about this for some time, anticipating the launch point of growth to be late 2024 and into 2025, and I think we've just launched sooner. Importantly, as you think about our S&O pipeline, it was $50 million last quarter, it's $50 million again this quarter, roughly, but that doesn't tell the story. We've replenished $14 million of ABR in that portfolio, so we've delivered $14 million a little sooner than we anticipated on average, but we filled it right back up, and that's what's kind of raising our eye level or kind of the water level for us in 2024 and then compounding that into 2025. Thanks, Juan. Thank you. The next question is from Dori Keston with Wells Fargo. Please go ahead. Thanks. Good morning. It looks like some of the legacy or stat office building sales were pushed into 2025 in your disposition guide. Can you just remind us if there's any other non-core, non-long-term assets from our stat that remain beyond those? I got it. Let me talk about the guidance, and Nick, if you'd like to color it up, please do so. Dori, it was just a bit of a change in, as you mentioned, we had three or four or Stat middle kind of very small office buildings that we would like to move. They're non-core, non-strategic assets. I think in total we're talking $15 million or so proceeds. We've moved that out of this year and more to come on our disposition guidance next year. We are going to withhold that until next quarter. I want to remind you of what we said at the time of the merger. There is nothing disproportionate about the quality of the Stat middle assets as we merge them into Regency, and they won't result in a disproportionate kind of disposition program going forward. Thanks, Dori. Thank you. The next question is from Haendel St. Juste with Mizuho Securities. Please go ahead. May we request you to unmute your mic and go ahead with your question, please? Yes. Rookie mistake. So appreciate the color on 2025, the initial kind of guidepost. I guess my question is on the debt maturities here. You've got $300 million or so of debt maturing next year with three handles on them. So I guess I'm curious, what's your plan, what's your thinking there, perhaps timing it? Is that refinancing kind of embedded within that 5% FFO growth outlook for next year? Thanks. Yeah. The Nareit FFO headwind would include the impacts from the debt changes both in 2024 and in 2025. So importantly, the largest impact actually has to do with what we financed this year, which, as you know, was all affected basically right at the midpoint of the year in June. So we need to capture a full year of that in 2025, but we do have a very late 2025 maturity that we have incorporated into that headwind. We're going to. It's at a favorable rate, as you mentioned. We're going to use that capital and that cost of capital as long as we can. We're going to be very tactical with our window selection as we work in the capital markets next year, and we will refinance that bond into the public market at the right time. Thanks, Haendel. Thank you. The next question is from the line of Ronald Kamdem with Morgan Stanley. Please go ahead. Hi, this is Matt on for Ron. You guys mentioned that tenant demand was very strong this quarter, and you could see that in the same-property shop percent leased number. How should we be thinking about that going forward over the next 12-24 months? Hey, Matt, thank you for the question. This is Alan. Demand is strong, and I would say we've set a recent record high on shop leasing at 93.7%, but we're not pulling the troops off right now. They're staying focused. We are seeing a lot of tenants still willing to engage, not just on vacant spaces, but on spaces that are occupied right now. Sephora, J.Crew, EverBank, Mendocino Farms, they're all looking at spaces that are occupied, not just signing leases in 2025, and I'm just naming a few, but also signing leases in 2026. So we would expect to continue pushing forward. I don't have my sights set on a particular number as part of that process, but we're focused on continuing to drive the shops, and we're focused on our anchor side as well, trying to get that back to our peak levels of roughly 98.5%. We believe there's runway, and the team is committed. I'm disappointed that Alan didn't say it for the third consecutive quarter. Records are meant to be broken, Lisa. Thank you. I want to say it before you say it, right? Thank you. Matt, thanks for the question. Thank you, guys. Thank you. The next question is from Samir Khanal with Evercore ISI. Please go ahead. Hey, Mike. On the 3.5% for next year, I just want to understand because I think the expectation is for the group, and not only Regency, but the group to accelerate growth next year. Look, maybe you're being conservative here, but I get the rent commencements, the higher occupancy, but is there something that's sort of putting a lid on better growth next year? I just want to make sure that I'm not missing anything here. Thanks. I don't think you're missing anything, Samir. And I actually, I mean, as Lisa's point that she was making earlier in the call, this is above trend growth. This is 3.5% two consecutive years is on a stabilized basis that would be considered exceptional. We are benefiting from occupancy gains. I wanted to, from Matt's question and yours, I would encourage people to take a look at page seven in the earnings deck that we put out, and that really frames for everyone the opportunity set to move percent commenced. I will share with you that as a supporting element of that 3.5% headwind in the next year, we are anticipating moving our commenced occupancy by in the area of 75-100 basis points north, which if you study the history of that page, you'll see moving commenced occupancy by 100 basis points is about as good as we can and about as fast as we can run. The teams are pushing the pace on that every single day, and we're very proud of them. That's 75-100 basis points is a very healthy change in percent commenced. To answer your question directly, what's the headwind? Frankly, it's just time. We've got to lease the space. We've got to build out those spaces. We've got to deliver that space, and we're doing that as well as we possibly can right now, and very proud of the team. Thank you. Thank you. The next question is from Floris van Dijkum with Compass Point. Please go ahead. Hey, good morning, guys. Thanks for taking my question. You have one of the highest percentages of ABR coming from shop space in the sector, I think, at 58%. But as you look at this S&O pipeline, and typically, which I think is around 57% shop, but shop rents are double the typical anchor rent. I mean, is there a scenario here over the next 18-24 months where you're going to have more than 60% of your ABR coming from shop space? Floris, I'm not going to get into necessary specifics. I hope that we continue to lease and bring and commence our anchors as well as shop space. But when you think about just our investment strategy, our portfolio quality, for as long as I can remember, even at a time when there were some of our competitors that were talking about accumulating shop space and making them into anchors, we have not been afraid of shop space. We like shop space. Clearly, you just pointed to the fact that the rents are higher. We typically get better contractual rent steps. The growth is better. But at the same time, it's a balance. We also very much appreciate and acknowledge the steadiness, the sustainability of the cash flows that we get from our anchors. Remind you, it's been almost four or five years now that because of the quality of the cash flow and the NOI stream at our shopping centers, we didn't need to cut our dividend during COVID. And I think that that's really it's a really important factor, and we balance it. But we lean into shop space. We like shop space. We like the format of our existing portfolio, and we intend to continue to grow in that sector. Thanks, Lisa. Thank you, Floris. Thank you. The next question comes from Linda Tsai with Jefferies. Please go ahead. Hi. Thank you. In terms of building and replenishing the SNO pipeline, you said you replenished with $14 million this year. Do you think that stays elevated or compresses next year? It's a blessing and a curse, right? We want to continue to elevate. We want to continue to lease more space and absorb and set new records, as Alan indicated, but we're also going to commence rent, right? Linda, I do think from a trajectory perspective, we will commence that SNO pipeline over time and into 2025 as we because we're just running out of it. We're hitting kind of top ends of percent lease. It's less space to lease. You should expect us to compress that going forward as our outlook for material move-outs isn't significantly high either, so I do anticipate us compressing that going forward. It won't compress to historical averages in one year, and we're on the same page internally here. We have more than one year of growth ahead of us in a disproportionate manner because of increases in rent-paying occupancy. Thank you. Thank you. Thanks, Linda. The next question is from Alex Craigen with BTIG. Please go ahead. Hi. Thank you for taking my question. One on the development pipeline. It looks like it's currently at $237 million. Curious how big that pipeline can get in the next year. Yeah. Appreciate the question, Alex. So as you alluded, our total in-process development and redevelopment right now is over $600 million. So the team's just done an exceptional job of continuing to bring projects online, but also continuing to execute on, as I mentioned in prepared remarks, Glenwood Green, the project we just completed, a ground-up project, Old Bridge, New Jersey, the team did a phenomenal job of bringing that online. And so as we've indicated, we expect to start over $200 million a year. 2023, we started $250 million. This year, we expect to start another $250 million of projects. And we're very bullish on the future pipeline as we move into future years of continuing to start and ultimately deliver over $200 million of projects year in and year out. We love the platform, and we're going to continue to lean into it. Thank you. Thank you. Before we take the next question, a reminder to all participants that you may press star and one to ask a question. The next question is from Michael Mueller with JPMorgan. Please go ahead. Yeah. Hi. How does what you're expecting today for new development stabilization timeframes compare to what you saw, say, between the GFC and COVID? Yeah. It's a great question, Mike. I would tell you, similar to what Alan's remarks were about what we're doing in terms of the operating portfolio and bringing tenants online aggressively, we're seeing the same thing on the development end. We are starting to see permitting, supply chains, bidding processes, I would call it, stabilize. And so I would expect our ground-up developments from commencement of construction to coming online be in the two- to three-year range, depending on the size of the project, the scale of the project, and the construction timeline. But again, I point to Old Bridge as a really good example of that. The team did a really nice job starting that and bringing it online, not only on time, actually a little ahead of schedule and ahead of budget as it relates to NOI. And so we have confidence in our ability right now to start these projects and deliver them on time and on budget. Thank you, Mike. Okay. Thanks. Thank you. The next question is from Ki Bin Kim with Truist Securities. Please go ahead. Thanks. Just a couple of follow-ups here. What drove other property rental income higher? And I'm curious if that's a more sustainable level? Hey, Ki Bin. Yeah. Real quick. So as you can see in the disclosure, we differentiate between other lease income and other property income. And just for everyone's benefit, lease-related other income items are in the lease line items. So think storage, signage, ATMs, temporary tenants, etc. Other property income is the ancillary income streams that our shopping centers can generate because of their quality and nature, but they're not contractual, right? So insurance settlements, fees, parking, etc., items like that. There was a planned higher level of other property income in the settlements area and the insurance settlements area that did come into fruition in the Q3. Importantly, it was part of our initial plan coming into the year, so it is not a contributing factor to our outlook increase for the year. And it is one-time in nature, but so is everything within that category. What we know when we zoom out is that we will consistently drive other income in our portfolio because of its location qualities. Okay. Thanks, and just going back to that 3.5% Same-Property NOI commentary on 2025, just so I better understand some of the detracting elements. Are you at all watching any kind of larger leases that may not renew that might be causing some cushion into that same sort of line number? I mean, we're doing a bottom-up plan, Ki Bin. We're very aware of the needle-mover leases. 2024 was a unique set of circumstances. So to the extent we had any big pluses or minuses from big anchor leases, those would be captured in that number. I do want to remind everyone, credit lost in 2024 in the 50-75 basis points area on a revised basis. And in my comments earlier in the call, we will plan for more of a historical average year next year. So that is a touch of a headwind, and remember, historical averages are 75-100 basis points. Okay. Thank you, Mike. Sure. Thank you. As there are no further questions, I would now like to hand the conference over to Lisa Palmer for closing remarks. Thank you all for your time. Appreciate your interest in Regency. We will see, hopefully, many of you in, I think, just a few weeks. Thank you. Thank you. This concludes today's conference. You may now disconnect your lines at this time. Thank you for your participation.